How to Buy Bitcoin With PayPal UK – Beginner’s Guide

For over 2 decades now, PayPal has been one of the most popular methods of making online payments and managing your funds via the internet. It is very useful and convenient to use, which is why it is preferred by citizens around the world despite some of its flaws.

More recently, the platform has now announced that you can buy cryptocurrencies through it too. If you wish to learn how to buy Bitcoin with PayPal, keep reading and this guide will explain all you need to know about it.

Where can you buy Bitcoin with Paypal?

In the list below, we have prepared a few of the most popular platforms that you can use to buy Bitcoin through the PayPal application. Read on and see which option is best for you.

1. Coinbase: the largest U.S. cryptocurrency exchange, offers a secure platform for trading over 25 cryptocurrencies, including Ethereum, Litecoin, Bitcoin Cash, and XRP. Founded in 2012, Coinbase supports all U.S. states except Hawaii.

How to Buy Bitcoin with PayPal UK – Step by Step Guide

Buying Bitcoin with PayPal can be done via the Coinbase broker service. If you only wish for a quick guide on how to get started on Coinbase, here is what you need to know.

• Open an account. Go to the Coinbase website and open a free account by making a new one or logging in with Facebook or Google.
• Upload ID. Verify your identity by filling out a form and uploading your ID, driver’s license, or passport.
• Deposit funds. Deposit funds on Coinbase’s platform via PayPal. You can deposit as little as $1 per transaction.
• Buy Bitcoin with PayPal. Finally, use the deposited funds to purchase Bitcoin on Coinbase.

Where to Buy Bitcoin With PayPal UK

There are several platforms that you could use in order to buy Bitcoins through PayPal in the UK, and then popular platforms have been reviewed below in detail.

1. Coinbase – The largest and most popular broker to buy with PayPal in UK

Coinbase, the largest U.S. cryptocurrency exchange, offers a secure platform for trading over 25 cryptocurrencies, including Ethereum, Litecoin, Bitcoin Cash, and XRP. Founded in 2012, Coinbase supports all U.S. states except Hawaii. With a user-friendly interface, Coinbase Pro offers lower fees and more features, making it a popular choice for new crypto investors looking to enter the crypto market.

Deposit and withdrawal methods for cryptocurrency users vary by location, with U.K., U.S., and European customers having different options. In the UK, payment options include bank account, debit card, wire transfer, PayPal, and Apple Pay.

Bank account payments take 3 to 5 business days, debit cards are ideal for small withdrawals, wire transfers take 1 to 3 business days, PayPal is ideal for small investments, and Apple Pay is also instant.

Coinbase’s trading fee system is complex and expensive, with fees varying from country to region. The platform’s standard platform sets it apart from competitors. Coinbase charges variable spreads for purchase and trade transactions, with fees varying from 0.50% for purchases below $10,000 to 0.35% between $10,000 and $50,000. The “Coinbase trading fee” can vary depending on the purchase amount, payment type, and region.

Coinbase offers a beginner-friendly platform for trading cryptocurrency, allowing users to send and receive messages, send and receive cryptocurrency from wallets, and receive cryptocurrency from other Coinbase wallets. With over 100 trading pairs worldwide and 40 crypto-to-crypto pairs across 42 regions, Coinbase Pro provides robust trading experiences.

67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

Benefits of Buying with PayPal UK

There are several reasons why people prefer buying Bitcoins and other cryptocurrencies through PayPal, and these are the same reasons that have positioned it at the forefront of the payments industry. They provide a viable and feasible alternative to buying cryptocurrencies through debit and credit cards, and this is true for a variety of reasons. These reasons have been discussed below in detail.

Security

The first benefit that springs to mind when you use PayPal instead of a traditional wire transfer or your credit/debit card in order to purchase cryptocurrencies is security. There have been numerous incidents and scams in the past where users have tried to deposit their funds onto a platform, and have found their account information getting leaked to a third party, which has resulted in huge financial losses.

While these data breaches are rare and usually only affect unregulated platforms, it is a very real possibility, and therefore you might be better off using a method of payment wherein this is not a possibility.

PayPal offers this functionality because when you make a transaction through PayPal, you only mention your account email ID on the transaction. Your credit/debit card and bank account are linked to your PayPal account instead of being used on the platform directly, which provides you with an additional layer of protection from anyone who might be looking to steal your information. Therefore, the only point where your bank details are stored is during the creation of your PayPal account.

Therefore, when you buy Bitcoin with Paypal, you won’t need to enter your debit or credit card numbers into the website of your chosen cryptocurrency trading platform. On the contrary, you should have already linked a payment method to your Paypal account. This means that once you specify how much you would like to deposit, all you need to do is enter your Paypal login credentials.

Then, it’s just a case of selecting your preferred funding method or better – using the funds that you already have in your Paypal account. We should also note that the e-wallet provider utilizes data encryption technologies, so your chosen Bitcoin exchange will never have access to your Paypal logging credentials. This creates an additional layer of security and ensures that your funds are protected.

As an additional benefit, Paypal offers something called Buyer Protection. As the name suggests, this means that you are protected from unauthorized purchases, as well as fraud. This operates like the chargebacks system offered by debit/credit card providers. Therefore, in the worst case, even if there is a data breach and someone gets access to your account credentials, any funds that they withdraw or use will be reimbursed to you as soon as you report it as a false transaction.

Instant Deposits

In a market as volatile as cryptocurrencies, timing matters quite a bit. For example, Bitcoin could be down today and it looks like an opportunity to buy the dip, but if you choose to do so via a bank transfer, it will take up to 3 days for the funds to show up in your account. By then, the price could have gone up resulting in your missing out on potential gains. Buying Bitcoins through PayPal fixes this since it allows you to instantaneously add funds to your account and use them to buy cryptocurrencies.

When using a regulated broker, you can buy Bitcoin with PayPal instantly. There are more than 250,000 confirmed Bitcoin transactions per day, according to the source.

This is because you will either be using your Paypal balance or funding the deposit with a debit/credit card. Interestingly, when you fund a Paypal transaction with a linked bank account, you will sometimes benefit from an instant transfer. This is at the discretion of Paypal and is usually based on how long you have been a customer.

No Fees Charged by PayPal

When you choose to deposit funds into your account through traditional means such as the use of a wire transfer or a credit/debit card, there are a variety of fees associated with it. These fees can be split into three main categories. The first category of fees that you might have to pay is a flat deposit fee that your trading platform might charge.

The second type of fee that you might pay is the currency conversion fee, which is primarily done if you wish to add funds from your UK bank account to a broker that does not offer GBP as a base currency. In this case, you will end up paying up to 2-3% of the total transaction amount in currency conversion fees. This is not something that most investors wish to do, especially if you are going to regularly deposit and withdraw funds from your account.

Hence, PayPal provides a useful and viable alternative to this. By enabling you to hold balances in multiple currencies through your account, PayPal allows users to circumvent the currency conversion fees and instead add funds directly to their accounts in whatever currency they wish

The third type of fee is the payment provider fee, which is usually incurred when you choose to add funds to your account via a credit/debit card. In this case, while using a broker like Binance, you will end up paying a significant part of your deposit as fees to the payment providers.

This can be avoided through PayPal too. When you make an online purchase with your Paypal account, the digital wallet provider will not charge you any fees. Although this is usually the case with debit cards and bank account transfers anyway, avoiding unnecessary fees is crucial when buying Bitcoin.

Ease of Use

Paypal offers lots in the way of convenience. Using PayPal to deposit funds into your account does not require you to remember your debit card details or carry it around with you at all times, as you can just simply link it to your PayPal account and use it wherever you want.

When dealing with a cryptocurrency as volatile as BTC, where 10% daily jumps are not unusual, this becomes even more important, as it is crucial for you to be able to add funds from wherever you may be, whether or not you have your debit card with you. PayPal allows you to do that with the highest levels of convenience.

For example, if you wish to buy Bitcoin right now, but you’re outside and have forgotten your wallet at home. Instead of not being able to add money and having to wait until you get home, you can simply open your PayPal account and use that to add funds to your cryptocurrency wallet and buy Bitcoin.

As a result, as long as you know your Paypal login credentials, you can still purchase Bitcoin. This is because you will not be asked to enter your debit/credit card numbers – as long as the respective card is linked to your Paypal account.

Fast Withdrawals

Perhaps one of the well-known benefits of using Paypal to buy Bitcoin is that the end-to-end withdrawal process is super-fast. Firstly, this is because online brokers typically process e-wallet withdrawals much faster than debit/credit cards and bank accounts. This is because Paypal is less bureaucratic, meaning fewer checks need to be made. This is because you will have already completed the PayPal ID verification when you first signed up.

Your chosen Bitcoin broker will be able to see this, meaning they often process Paypal withdrawal requests on a same-day basis. Additionally, once the broker in question has processed the withdrawal, this is where Paypal really shines. This is because from the moment the money is transferred, it should appear in your Paypal account in less than a minute. Debit/credit cards, on the other hand, usually take 2-3 working days. Bank account withdrawals are even slower.

Depending on who you bank with, this can take anywhere from 3-7 working days. Once the money does hit your Paypal account, you can then withdraw the funds to your bank account at the click of a button. In all but a few rare cases, this should hit your UK bank account instantly.

Bitcoin PayPal Regulation in the UK

It is important to note that every platform cannot accept deposits via PayPal to purchase Bitcoins and other cryptocurrencies. This is because cryptocurrency brokerage sites must have the legal remit to accept fiat currency payments.

Not only does this include traditional debit/credit cards and bank account transfers – but it also includes e-wallets like Paypal. In other words, you couldn’t create a website and allow people to buy Bitcoin with Paypal. On the contrary, this luxury is reserved for heavily regulated entities.

This is important, as it adds to the security of the platform and ensures that you are exactly who you say you are. This also helps to ensure that your identity is verified, and therefore your funds are secure.

Crucially, Paypal operates within the law when it comes to the countering of money laundering. As such, any unregulated platforms that attempt to use their e-wallet services without the legal remit to do so will have their Paypal account shut down and all funds frozen.

How to Buy Bitcoin With PayPal UK

Here is a list of steps that you need to follow in order to begin trading altcoins on Coinbase. The process of opening an account and trading on Coinbase is quite straightforward and involves 4 main steps.

Step 1: Open an Account

The first thing that you need to do is to navigate to the Coinbase homepage and click on “Sign up”. Then, you will be asked to fill a short form that asks for your contact details and makes you set up your login credentials. Alternatively, you can also sign up via your Facebook or Google account for easier sign-ins and to avoid having to remember your username and password.

Step 3: Deposit Funds

The third step is to then deposit funds into your account. The minimum deposit on Coinbase is 1 GBP. This can be done in a variety of ways. For starters, you can add money to your Coinbase account via bank transfer or via credit/debit cards. They also accept a variety of e-wallets such as PayPal and Skrill. You can add funds in different currencies too, such as USD, GBP, and EUR. There are no fees or charges associated with depositing funds into your account, and they show up almost immediately.

Step 4:  Buy Bitcoin with PayPal

The last step is then to begin trading Bitcoins. Simply head over to the search bar, search for Bitcoin or BTC, enter the amount you wish to buy or sell, and click on the order button.

Can You Use PayPal to Buy Bitcoin From A Decentralized Exchange?

It is generally not possible to buy Bitcoin with PayPal from a decentralized exchange (DEX) directly. This is because most DEXs do not support fiat currency transactions, and PayPal is a fiat payment method. Users may need to first convert their PayPal funds to a supported cryptocurrency and then trade that cryptocurrency for Bitcoin on the decentralized exchange. Alternatively, they could use a centralized exchange that supports PayPal deposits to purchase Bitcoin directly.

Bitcoin Wallets that Support PayPal

There are no Bitcoin wallets that directly support PayPal, as PayPal is a type of fiat payment processor and not a decentralized currency. However, some exchanges and peer-to-peer marketplaces may allow you to buy Bitcoin using PayPal as a payment method. In this case, you would need to have a separate Bitcoin wallet to receive and store your purchased Bitcoin.

It is important to research and choose a reputable exchange or marketplace and ensure that you have a secure Bitcoin wallet to protect your funds. Additionally, some services may charge high fees or have limitations on the amount you can buy with PayPal, so it’s important to read the terms and conditions before making any transactions.

Ranking criteria we used to evaluate these platforms

We used several criteria to choose these platforms are several, but we will mention the most important ones. Firstly, we chose some of the most popular platforms that offer the option to buy bitcoin or other cryptocurrencies with Paypal, such as Coinbase. We also considered the security aspect, which is very important for investors as there is always the risk of fraud or scams in the crypto space. This extra security measure gives traders more confidence to trade and buy cryptocurrencies.

Coinbase is suitable for all levels of investors, whether they are experienced or just starting out. We’ve also checked out the cryptocurrency offerings that these platforms have to offer and we can say that you have a wide range to choose from. As far as fees are concerned, they vary and depend very much on the country or region you are in. For example, on Coinbase you can use PayPal for smaller investments.

Conclusion

In this article, we have taken a closer look at how to buy Bitcoin with PayPal in the UK. We have established that it is not possible to buy Bitcoin from decentralized exchanges with PayPal however, some centralized exchanges accept the payment method. Purchasing Bitcoin with PayPal may incur higher fees than other payment methods so it is important to conduct thorough research before choosing an exchange or making any investment decisions.

From the list below, where we have looked at each platform that offers the option to buy Bitcoin with PayPal, you can choose the one that is right for you. Don’t forget to do your research before making a choice, and if you’re just starting out, look for platforms that offer a free trial demo.

Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment, and you should not expect to be protected if something goes wrong. Take 2 mins to learn more. "

FAQs

References:

“https://www.grandviewresearch.com/industry-analysis/crypto-wallet-market-report”
“https://www.simplilearn.com/data-encryption-methods-article”
“https://www.sofi.com/learn/content/decentralized-exchange/”
“https://tipalti.com/how-does-paypal-work/”
“https://explodingtopics.com/blog/blockchain-stats”